Bosses aren’t taking the great resignation wave seriously enough. For the first time in a generation, the power balance in the workplace has shifted to workers, and businesses who try to hold on to talent with perks like no-Zoom Fridays and signing bonuses for warehouse workers are falling behind.
Locked in their bureaucratic habits, leaders forget that just saying “thank you” sincerely and often is the most effective way to create a culture where people want to stay.
Does that sound simplistic? The data prove that a culture of recognition — both managers and peers recognizing each other and saying “thanks for the good work” — goes a long way toward increasing loyalty, mitigating burnout and making people feel valued.
While your competitors squeeze their bottom lines in a salary arms race, consider how the power of recognition can attract and retain employees.
The power of thanks
The business case for a culture of recognition is easy to quantify. Workers who are thanked for their work have lower turnover, even high performers and people high in the organization. It’s just human nature to enjoy someone saying “thank you.”
One of the most important metrics: When somebody receives more than five formal “thank you” moments in a year, their propensity to leave is cut in half, from about 15% to 7%. If they receive up to 12 moments of recognition per year from a manager or peer, that goes down to 2%. (Social recognition systems track this data and quantify its value.)
Consider the savings in turnover costs alone and you wonder why leaders aren’t taking time every day to express thanks, loyalty and appreciation.
When I talk to CEOs about gratitude and recognition, they typically think it’s a little hokey. The Harvard Business Review, The Wall Street Journal and leading organizational psychologists, however, take it very seriously. Recognition builds trust and tighter relationships, which in turn streamline teamwork and information-sharing.
Research shows that people who have been thanked recently rank high in feelings of psychological safety. That benefits other goals like inclusion and belonging. This works both ways – just expressing thanks makes employees feel more positive and engaged. They step out of their professional armor and even become a little vulnerable when they say “thank you.”
While leaders must initiate cultural changes like public recognition for a job well done, a culture of recognition really takes off when every employee picks up the habit. As a result, an organization will retain positive people that are impactful and innovative because they are happy and connected to the humans around them. The network effect of appreciation has the same properties as other networks as it becomes habit: Thanks begets more thanks, which fuels positivity.
It’s a great time to quit a bad job
As the U.S. economy bounces back from COVID-19, hiring is accelerating, especially in high-turnover areas like leisure and hospitality. Almost a million people left their jobs in June. The economy is growing, and unemployment claims are at pandemic lows. Job openings top 9 million, in part because fears of COVID-19 remain strong among both the employed and unemployed.
So many job openings mean lots of opportunity for workers who are fed up with lousy workplace conditions. Sometimes that means physically uncomfortable workplaces. But often it means the classic problem of a bad boss – and the U.S. Chamber of Commerce just found that owners of the smallest businesses are less concerned about employee well-being than larger businesses. That’s a formula for disaster on Main Street storefronts like restaurants and retail, because they can least afford to raise wages or enrich benefits – and even now, they’re not planning to dole out raises.
Show your culture when hiring
Changing a culture takes time, so what are you going to do now if some of your people do leave? Re-engineer your recruiting, hiring, and onboarding practices to show candidates that they will be a key part of creating a more human workplace. Emphasize the human values of your workplace that appeal to today’s candidates, such as meaningful work, appreciation, work-life harmony, diversity/inclusion/belonging as well as professional growth. Get past the obsolete view of work as a dispassionate contract. Work is a community – one of the most important for human happiness.
Train your managers to express appreciation by doing away with the annual performance review and changing to continuous feedback conversations, as IBM has done. Overcome cynicism about a culture of recognition by grounding it in business metrics – turnover rates, employee engagement scores, performance reviews, and financial results.
Leaders are undertaking big cultural changes today including digital transformation, agile management techniques, equity and inclusion programs, and broad well-being initiatives. Positive human connection enables employees to ride any and all of these waves of change with enthusiasm, confidence, and mutual trust.
That connection among all employees begins with the simple act of saying “thank you.”